Labor Law -- 2012

National Association of Manufacturers v. NLRB   (U.S. District Court for the District of Columbia)

Challenging NLRB's requirement to post provisions of NLRA

The NAM filed this suit challenging a regulation issued by the National Labor Relations Board that requires employers to post in their workplaces a notice of the right of employees to organize into unions, bargain collectively, discuss wages, benefits and working conditions, jointly complain, strike and picket, or choose not to do any of these activities. The required notice also lists all the things an employer or a union may not do under the law.

The regulation requires posting in "conspicuous places" as well as where other notices to employees are customarily posted, and on electronic sites if the employer customarily communicates with its employees about personnel rules or policies by such means. In addition, if 20% or more of an employer's workforce is not proficient in English and speaks a language other than English, the employer must post the notice in the language employees speak. Special requirements apply to different segments of the workforce that speak different languages. The NLRB listed this rule as "major," estimating a total compliance cost of $386.4 million for some 6 million employers nationwide.

The NAM raised 4 issues in our complaint. First, we alleged that the National Labor Relations Act (NLRA) does not expressly grant the Board the authority to promulgate a rule requiring employers to post a notification of employee rights under the NLRA. Second, the Board's authority under the NLRA is triggered when a representation petition or an unfair labor charge is filed, not before. Third, the rule purports to establish a new unfair labor practice -- i.e., failing to post the required notice -- without the statutory authority to do so. And fourth, the new regulation authorizes the Board to allow any employee to file unfair labor practice charges long after the 6-month statute of limitations has expired. We argued that the NLRA does not authorize the Board to waive the statute of limitations except for members of the armed forces whose service interferes with their ability to file charges on time.

The NAM asked the court to declare the notice posting requirement null and void. Failure to post the notice could result in the Board finding that an employer engaged in an unfair labor practice by interfering with, restraining or coercing employees in the exercise of their rights. It could also result in waiver of the statute of limitations for employee complaints about other unfair labor practices, or could be used as evidence against an employer in any case in which unlawful motive is an issue.

On Sept. 28, the NAM and co-plaintiff Coalition for a Democratic Workplace, filed a motion for a preliminary injunction and an expedited hearing. We hoped to have the court rule before the effective date of the regulation, or enjoin NLRB implementation and enforcement of the rule indefinitely. We hoped to avoid a situation where companies needed to implement the rule by November 14, its original effective date, only to find that the rule was issued unlawfully.

On Oct. 5, the NLRB announced that it would voluntarily delay implementation of the posting requirement until January 31, 2012., and after oral arguments on December 19 in which the judge sought a further extension, the Board postponed the effective date again, until April 30, 2012.

On March 2, Judge Amy Jackson ruled that the NLRB has broad authority to issue rules, and the notice posting provision was valid. However, the Board did not have the authority to impose the penalties for noncompliance, namely making failure to post an unfair labor practice and suspending the statute of limitations for employees that want to file suit for unfair labor practices years after they occur. However, the NLRB may find the failure to post the required notices to be an unfair labor practice, or to toll the statute of limitations, in case-by-case decisions. Failure to post the notices could in some cases result in findings that an employer intended to improperly influence employees from exercising their rights, or could make it easier for the Board to allow an employee to file charges after the statute of limitations has run out.

The court rejected the NAM's First Amendment arguments, and found that the enforcement provisions were severable from the posting requirement, thus allowing the posting requirement to continue to stand even though a portion of the regulation was found to be invalid.

On March 5, the NAM and others filed a notice of appeal. All are challenging the adverse decisions on the posting requirement, and all but the NAM are challenging the validity of the recess appointment of some of the current Board members who were appointed by President Obama while the Senate was still meeting regularly in pro forma sessions.

Related Documents:
NAM Notice of Appeal  (March 5, 2012)
NAM Reply brief  (November 22, 2011)
NAM Motion for Preliminary Injunction  (September 28, 2011)
NAM Complaint  (September 8, 2011)